China calls for agreement on Asian free-trade deal ‘as soon as possible’

China has called for the 16 nations involved in talks on an Asian free-trade deal to reach an agreement “as soon as possible”, ahead of a regional summit next week.

Assistant Foreign Minister Chen Xiaodong also said the Beijing-led Regional Comprehensive Economic Partnership (RCEP) would make a significant contribution to integration and free trade in the region, during a press briefing in Beijing on Thursday.

“RCEP is currently the largest scale trade negotiations in the Asia-Pacific,” Chen said. “The Chinese believe that under the current situation, concluding the negotiations and reaching an agreement as soon as possible will be conducive to deepening regional integration, addressing the challenge of unilateralism and protectionism, and will be significant in creating an open, inclusive and rules-based global trade mechanism.”

Chen added that China also wanted to speed up negotiations on a code of conduct in the South China Sea, after Beijing and Association of Southeast Asian Nations (Asean) members in August agreed on a single draft negotiating text that will serve as the basis for adopting the code. Asean leaders will gather for a summit in Singapore next week.

The deepening trade war with the United States has given Beijing renewed urgency to push forward negotiations on RCEP – a deal that has been in the works for five years and brings together the 10 Asean nations along with China, India, Japan, South Korea, Australia and New Zealand.

The assistant foreign minister’s call comes after China on Monday reached an agreement with Singapore to upgrade their free-trade pact.

RCEP has long been seen as a rival to the Trans-Pacific Partnership (TPP) that was led by the US before President Donald Trump decided to withdraw from the trade deal in 2017. After the US exit, it was watered down and renamed the Comprehensive Progressive Trans-Pacific Partnership (CPTPP) by the 11 remaining members and will take effect on December 30.

Su Hao, a professor in diplomacy at the China Foreign Affairs University in Beijing, said that with China and the US locked in a trade war and the CPTPP about to kick in, there was new impetus to reach agreement on RCEP.

But Beijing has struggled to close the deal, as India continues to resist pressure to make a more ambitious commitment to lower its tariffs on imported goods, according to regional trade officials. Other countries have, meanwhile, stopped short of offering to open up their service sectors and committing to rules allowing the free movement of professionals in the region that India has been seeking, Bloomberg reported.

“It is difficult because India is still in the process of restructuring its industries … which may pose a challenge when it is integrating into the regional economy,” Su said.

The negotiations are also likely to be complicated by potential changes of government in some of the member countries such as Australia, India and Indonesia that have elections coming up next year.

Source: South China Morning Post